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Re-read Chapter 6 in Zondervan Minister's Tax and Financial Guide

Highlights: 

  • Ministers are granted the ability to seek an exemption from Social Security if they meet certain requirements.
  • By default, you will remain in the system. A decision to seek exemption must be based on conscience, not convenience. You must be morally opposed to acceptance of insurance from government assistance programs like Social Security, Medicare, Medicaid, food stamps, housing assistance, unemployment assistance, disability assistance, etc. You cannot make the decision to seek an exemption simply because you think you can achieve a better investment return on those funds elsewhere (economic reasons).
  •  
  • An exemption results in ceasing contributions to and eligibility for both Social Security (retirement protection as well as other assistance programs) and Medicare (medical insurance for those over 65 and disabled). 
  • By default, ministers remain in the Social Security system and are required to continue making payments directly to the IRS for their Social Security/Medicare coverage (see details below).  
Warning
Reliant is not able to assist you with this decisionprovide counsel in this decision and cannot assist in filing forms with the IRS. It is a completely personal decision . You may also want to talk with other ministers who have dealt with this optionthat each minister must decide based on their own convictions. We encourage you to read the relevant information in the Zondervan Minister's Tax and Financial Guide and talk with other ministers in your decision-making process. 



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titleStay in the Social Security System


Decide if you would like to claim your work with Reliant as related to your Commissioning/Ordination

By submitting your certificate to Reliant, you are choosing to apply your new tax status to your work with Reliant. This is not a required step. Once you submit your certificate, we must immediately change your tax status

and it cannot be changed back.

to no longer withhold FICA taxes. Once this change is made, we can not revert the tax settings unless the Minister has a job role change in which they are no longer performing ministerial services.

If you would like to claim your work with Reliant as that of a Commissioned/Ordained Minister, proceed to the next section. Otherwise, no further action is necessary. 




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titleOpt Out of the Social Security System


File Form 4361 with the IRS

See Claiming Exemption from Social Security Taxes for more information.

A minister is fully responsible for paying social security/medicare taxes (SECA) until the IRS sends a certificate verifying that the exemption request has been granted. 

Decide if you would like to claim your work with Reliant as related to your Commissioning/Ordination

By submitting your certificate to Reliant, you are choosing to apply your new tax status to your work with Reliant. This is not a required step. Once you submit your certificate, we must immediately change your tax status

and it cannot be changed back. If

to no longer withhold FICA taxes. Once this change is made, we can not revert the tax settings unless the Minister has a job role change in which they are no longer performing ministerial services.

If you would like to claim your work with Reliant as that of a Commissioned/Ordained Minister, proceed to the next section.

 Otherwise

Otherwise, no further action is necessary. 



Notify Reliant of your Commissioning/Ordination and your Tax Decisions

...

1. Email a copy of your certificate to Reliant

Whom to email: benefits@reliant.org

The certificate will be reviewed by a Reliant director and once it has been approved, you will be notified and your tax settings will be changed.

2. Notify Employment Services about your tax decisions


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titleStay in the Social Security System


Decide if you would like to take the FICA Bonus 

Reliant offers a bonus to offset the additional obligation of tax previously paid by the employer for Social Security. The amount of that tax obligation is 7.65%. This bonus will increase your monthly salary and will be included in your monthly paycheck.

Details: Once Reliant receives notification that you would like the bonus, you will receive a new salary offer. 

  • Ministers who communicate their decision to Reliant to remain in the social security system within 3 months of communicating their ordination/commissioning to Reliant will be eligible for the 7.65% FICA Bonus retroactively to the time period they began receiving Reliant wages as a minister. 

  • Ministers who communicate this decision to Reliant anytime after 3 months will be eligible for the 7.65% FICA bonus beginning with the next available pay date. (You will only be eligible for up to 3 months of retroactive FICA bonus and must request that in your email.) 

Whom to email: benefits@reliant.org

Research options for paying SECA to the IRS

Details: Remember, you must begin to pay your own Social Security/Medicare tax (now called SECA since you are considered self-employed) from the point in time that you are paid Reliant wages as a minister.

See Paying SECA Taxes for more information

Resource: Chapter 7 in Zondervan Minister's Tax and Financial Guide



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titleOpt Out of the Social Security System

If you have an exemption from Social Security, your email must explicitly stateplease send us an email stating, “I am exempt from the Social Security System because I am conscientiously opposed to receiving public insurance as a minister.”

This statement is official statement employers are required to collect as an assurance that the minister is properly informing their employer, Reliant, of their tax decisions as a minister.  

In some cases, Reliant may also request an electronic copy of the Minister's IRS approved Form 4361 for our records.  The collection of this form is a safeguard for the employee and Reliant as an employer, to ensure Reliant has an electronic copy saved to our records if ever needed as a part of interactions with the IRS regarding their minister's tax status.

Whom to email: benefits@reliant.org


3. Complete a Parsonage Request form if you wish to receive Minister's Housing Allowance (Parsonage)

 

Details: Once your parsonage amount has been approved, it will become effective on the next applicable pay period. To change your parsonage amount in the future, simply complete a new Parsonage Request form and share it with benefits@reliant.org for approval. Dave Meldrum-Green, our director of Organizational Affairs & treasurer, reviews and approves all parsonage requests. See Parsonage for more information. 

Resource: Chapter 4 in Zondervan Minister's Tax and Financial Guide

Whom to email: benefits@reliant.org


4. Submit a new Support Goal


Details: Make sure to wait to submit a new Support Goal until you have received confirmation that your bonus request has been processed.

Submitting a new Support Goal accepts and activates the bonus.

Resource: Support Goal on Staffnet


5. Submit an updated job description


Details: Send a new job description to your program team liaison reflecting your responsibilities as a commissioned or ordained minister.

Resource: Job Description

Whom to email: Your Reliant Program Team Liaison


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